One of the most important applications of long term evolution (LTE) technology is voice over LTE (VoLTE), which enables digitised voice packets to be transmitted over LTE data networks. Conventionally, LTE services have been used for data services with voice calls transmitted through dedicated voice channels. With VoLTE, both voice and data can be transmitted over the LTE band, thereby enabling efficient spectrum utilisation.
VoLTE deployment is still in the early stages and the investments undertaken for the same are yet to reflect in operator revenues. According to the Global Mobile Suppliers’ Association, as of January 2016, about 118 operators in 56 countries have invested in VoLTE deployments, studies or trials. About 46 operators have commercially launched high definition (HD) voice service using VoLTE in 29 countries. The GSM Association states that 2015 witnessed increased deployments of VoLTE in Hong Kong, Japan, Singapore and the US, and a large number of operators are expected to deploy this technology in 2016. Most of the VoLTE investments and subscriber uptake have been in North America, Japan and South Korea. In addition, operators are introducing VoLTE roaming in these regions, which is likely to spur migration in the coming years.
tele.net takes stock of the various advantages of deploying VoLTE, the case for adoption in India and the way forward…
Benefits of VoLTE over traditional technologies
VoLTE offers several advantages over traditional technologies through various features, thereby delivering higher quality of service (QoS) as compared to its conventional counterparts. For instance, VoLTE offers HD voice, which is clearer than the voice delivered on circuit-switched channels. The voice transferred through traditional networks uses 8 kbps codec while the voice transmitted through VoLTE uses 13 kbps, thereby delivering improved quality. Apart from this, VoLTE offers a short call set-up time of one second, which is much lower than the average call set-up time of four seconds on 2G and 3G networks. Another key feature of VoLTE service is its ability to deliver rich communication services (RCSs) that offer various features such as file transfer, language translation, voicemail, video calling and instant messaging. This allows operators to compete with the services delivered by over-the-top (OTT) players. Several studies have also estimated that VoLTE services provide improved battery life compared with older technologies, thereby making it an attractive option for end-users.
VoLTE complements smartphones and next-generation data services as it offers improved bandwidth and speed. As VoLTE allows voice packets to be transmitted over the more efficient data channel, as opposed to circuit-switched cellular voice channels, it offers several advantages to operators. For one, it enables them to consolidate voice traffic on LTE data channels, thereby terminating their legacy circuit-switched voice channels. This leads to a reduction in infrastructure costs for voice services. Moreover, spectrum that has been allocated for traditional voice services can now be used for data services.
In addition, under VoLTE, operators are able to transmit more simultaneous calls on the LTE bandwidth as compared to traditional voice channels. This would in turn improve the QoS and the overall customer experience. Consequently, the primary importance for operators in delivering VoLTE would be spectrum refarming and utilisation to meet the growing demand for data services. The industry believes that by having both voice and data on the LTE band, operators would look to convert their legacy GSM-and CDMA-based spectrum bands and network infrastructure to LTE, which is estimated to be 40 per cent more spectrally efficient.
VoLTE can also act as an anchor tenant on operators’ IP multimedia subsystem (IMS) network, to which subsequently more services based on RCS and web real-time communication can be added. Industry experts are also of the opinion that this IMS network, coupled with network function virtualisation architecture, will enable operators to provide open application programming interfaces to the application developer community. As a result, network operators would be able to monetise their network traffic while delivering a better user experience.
With the maturing ecosystem, VoLTE is likely to gain traction in India over time and be an important strategy for operators as 4G uptake increases.
Case for VoLTE in India
Over the past few years, the growth in 3G and 4G networks has been supplemented by the increasing uptake of OTT services. OTT players have been able to capture a large proportion of the market for messaging services, thereby impacting the SMS revenues of telecom operators. OTT players are now offering various voice services, which are also becoming popular among mobile subscribers. While these offerings are at present restricted as connectivity is lost and call quality suffers when users move outside Wi-Fi coverage, these issues may get resolved as 3G and 4G coverage improves over time. Consequently, OTT voice services may still provide strong competition to operators’ offerings in the coming years.
In this scenario, operators are looking at revisiting their voice strategies as these revenues still constitute the major share of their overall revenues. Although voice tariffs in India are among the lowest in the world, traditional voice services are considered more expensive than those offered by OTT players. Moreover, revenues from data services have not been enough to compensate for the expenditure undertaken in the form of spectrum payments and setting up of next-generation networks. VoLTE, therefore, is emerging as a promising option to boost the uptake of voice offerings. These services are likely to be cheaper than the traditionally available voice services and offer better quality as well.
Key service providers have already initiated steps to launch VoLTE services in India. Both Bharti Airtel and Vodafone India have tied up with Nokia Networks to deploy VoLTE technology on their networks. Idea Cellular is also planning for the same to compete in the upcoming 4G market. Initially, these services are expected to be launched in urban areas, where there is a stronger demand as well as a wider 4G presence. Further, pan-Indian 4G spectrum holder Reliance Jio Infocomm Limited (RJIL) has announced its plans to launch VoLTE services on its networks.
Meanwhile, the handset ecosystem is also evolving with the key vendors launching low-cost smartphones that can support 4G. According to Counterpoint Technology Market Research, currently, only about 2 per cent of smartphones in India are VoLTE enabled, most of them being iPhones. However, several vendors that offer low-cost handsets in India such as LG, Lenovo, Micromax and Intex have also announced plans to develop and launch VoLTE-enabled devices in India.
These devices would require a chipset and a software patch to make them VoLTE enabled. Currently, only a few Qualcomm chipsets support VoLTE and the minimum price of a VoLTE-enabled handset in India is estimated to be double that of a basic 4G smartphone. Meanwhile, RJIL is reportedly planning to make handsets under its Lyf brand. These phones will support VoLTE and will be marketed under Reliance Retail. Counterpoint’s research further states that all handset vendors are likely to introduce new devices with VoLTE capability instead of upgrading the existing ones, which would be more cost-effective.
The way forward
Currently, VoLTE has not had a significant impact on global operators’ revenues, as these services have not been priced high so as to encourage uptake. However, VoLTE is set to be an important parameter in reducing churn needed. Also, VoLTE and HD voice can further prompt operators to develop services and applications targeted at the enterprise market. These services may help in generating higher revenues owing to higher-value enterprise customers that have a lower churn rate as compared to non-enterprise customers.
VoLTE adoption is set to increase rapidly in the coming years. According to a recent study by Juniper Research, the number of VoLTE connections is likely to increase from about 123 million in 2015 to 2 billion by 2020. This would be driven by the various benefits offered to both users and enterprises, including efficient and cost-effective voice services, and the delivery of better multimedia services with greater bandwidth and speed.
These benefits hold significance for India, where operators are struggling with plummeting voice revenues and increasing competition from OTT players. With the maturing ecosystem, VoLTE is likely to gain traction in India over time. However, its benefits in the form of efficient spectrum utilisation will take a few years to materialise. Nonetheless, VoLTE will remain an important strategy for Indian operators in the next few years as 4G uptake increases.